Virtual Power Plants Will Reach $3.6 Billion in Annual Revenue by 2020, Forecasts Navigant Research

  Virtual Power Plants Will Reach $3.6 Billion in Annual Revenue by 2020,
  Forecasts Navigant Research

Business Wire

BOULDER, Colo. -- June 19, 2013

Using software systems, virtual power plants (VPPs) can combine a rich
diversity of independent resources into a unified network via sophisticated
planning, scheduling, and bidding of distributed energy resource-based
services. Driven by the integration of variable generation resources –
especially from wind and solar – a viable VPP market is emerging and will see
substantial growth, from a relatively small base, over the next several years.
According to a recent report from Navigant Research, annual worldwide revenue
from VPPs will grow from less than $1 billion in 2013 to $3.6 billion in 2020,
under a base forecast scenario.

Under a more aggressive forecast scenario, VPP vendor revenue could reach $4.3
billion by 2020.

“The growth in distributed, renewable power generation sources requires
additional supply and demand flexibility to accommodate fast ramping periods
and corresponding supply forecast error,” says Peter Asmus, principal research
analyst with Navigant Research. “VPPs represent an ideal optimization platform
for the coming transformation of the power grid.”

Rate-basing utility prerogatives still offer deployment barriers for both VPPs
and the complementary market for microgrids. Although recent regulatory
reforms are moving in the direction of a greater reliance on distributed
energy resources, centralized fossil fuel power plants will still dominate
electricity markets for quite some time. Compared to traditional coal and
natural gas-fired plants, VPPs offer a low-cost platform to squeeze more value
out of existing infrastructure assets and to reduce greenhouse gas emissions
associated with peaking power plants.

The report, “Virtual Power Plants”, examines the market for VPPs across four
key segments: demand response-based VPPs, supply-side VPPs, mixed asset VPPs,
and wholesale auction VPPs. The report includes both capacity and vendor
revenue forecasts for each of these four VPP segments, broken down by region,
through 2020. It also identifies key market drivers and barriers, and profiles
the key players in the emerging VPP market, including utilities, large
technology vendors, software firms, demand response aggregators, and selected
key component providers. In addition, the report details the key issues facing
primary VPP technologies, including smart grid automation, demand response,
combined heat and power, advanced energy storage, smart inverters, and plug-in
electric vehicles. An Executive Summary of the report is available for free
download on the Navigant Research website.

About Navigant Research

Navigant Research, the dedicated research arm of Navigant, provides market
research and benchmarking services for rapidly changing and often highly
regulated industries. In the energy sector, Navigant Research focuses on
in-depth analysis and reporting about global clean technology markets. The
team’s research methodology combines supply-side industry analysis, end-user
primary research and demand assessment, and deep examination of technology
trends to provide a comprehensive view of the Smart Energy, Smart Utilities,
Smart Transportation, Smart Industry, and Smart Buildings sectors. Additional
information about Navigant Research can be found at

About Navigant

Navigant (NYSE: NCI) is a specialized, global expert services firm dedicated
to assisting clients in creating and protecting value in the face of critical
business risks and opportunities. Through senior level engagement with
clients, Navigant professionals combine technical expertise in Disputes and
Investigations, Economics, Financial Advisory and Management Consulting, with
business pragmatism in the highly regulated Construction, Energy, Financial
Services and Healthcare industries to support clients in addressing their most
critical business needs. More information about Navigant can be found at

* The information contained in this press release concerning the report,
“Virtual Power Plants,” is a summary and reflects Navigant Research’s current
expectations based on market data and trend analysis. Market predictions and
expectations are inherently uncertain and actual results may differ materially
from those contained in this press release or the report. Please refer to the
full report for a complete understanding of the assumptions underlying the
report’s conclusions and the methodologies used to create the report. Neither
Navigant Research nor Navigant undertakes any obligation to update any of the
information contained in this press release or the report.


Navigant Research
Richard Martin, +1-303-493-5483
Laverne Murach, +1-202-481-7336
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